More than 1 in 5 towns could lose their post office in the next year, report warns

Small business owners say they've been forced to find extra jobs and give up annual leave as more customers manage their post online

Hundreds of post offices could be forced to close in the next 12 months, a report has warned, amid falling demand and wages.

A survey of 1,000 workers by the National Federation of SubPostmasters (NFSP) suggested that one in five could be axed from the high street in the next year as small business owners struggle to earn a living as wages fall.

It warned that 22% are planning to close, pass on their business, or downsize by staff that have been forced to go without holidays and take on extra jobs to make ends meet.

The UK currently has around 11,500 post offices - a number that's halved in the past 30 years. Many of these are concessions in branches such as WH Smith stores, while others are franchised as small businesses, often within newsagents.

These small business owners are paid a fixed payment together with a supplement according to how many transactions pass over their counter.

However, subpostmasters are unhappy with the amount they are paid for these individual transactions, and about three quarters (76%) of those surveyed said they earned less than the hourly national minimum wage for the work they do.

Moreover, with the ongoing shift to online, less transactions are passing through their doors - resulting in lower earnings.

Their biggest concerns include falling incomes and higher costs, low transaction rates for banking services, more customers using Royal Mail services directly via the internet, and fewer using a Post Office card account.

'A ticking time bomb'Calum Greenhow is chief executive of the NFSP and also worked as subpostmaster for 23 years.

"We can see how easy it would be for subpostmasters to lose faith and feel disenfranchised, to feel the system is working against them. For many of you, your feet are going to do the talking," he said.

Those who took part in the survey have been running post office counters for an average of 12 years, and 61% said they are earning less today than when they started.

Andy Furey, national officer at the Communication Workers Union which represents about 500 postmasters, said local communities are at risk of losing their post offices at a time when more vulnerable members of society are already suffering from thousands of bank closures and a cash machine crisis.

For many communities, the post office now acts as the in-between for these customers, allowing them to manage their bank accounts over the counter - including making payments and in some cases, applying for mortgages.

"This is a ticking time bomb. Postmasters are handing back the keys because they can’t make a living. The operating model is that they’re simply not paid enough and many are saying they can’t make ends meet," Furey said.

"The Post Office and NFSP are sleepwalking into a nightmare. Postmasters have been let down seriously here, with many working for less than the hourly national minimum wage."

The comments were made as part of a judgment on a case where postmasters are taking action against the Post Office over an IT system that staff said caused some of them to be wrongly accused of theft and false accounting.

More than 500 workers are suing the post office over losses incurred at new post offices since 2000 after the system was enforced in 12,000 branches.